[kictanet] Day 5 - Statistics onAffordability- CCKInternetStudyReport

Wed May 9 18:59:56 EAT 2007

Dear Lucy,
We are rolling out the Digital Villages in July.  We needed funds to do
that and I can confirm that we have the resources in the next FY.

Regards

Ndemo

> Kai:
>
> I see your point, again I will use my previous domicile as a case in
> point, the Federal Government is the biggest employer/buyer of supplies
> and services in the Washington DC metro area (Virginia, Maryland, and of
> course Washington DC) hence e-governance/e-learning is a must and I think
> the Kenyan government recognizes this from the various initiatives
> currently on going, I just think its just a matter of time.
>
> The only point where you and i part ways is your stand that the Government
> should not be involved in infrastructure building because the Government
> has an obligation to ensure that all Kenyans have access to the internet
> while the private sector has to have a business case to justify coverage
> of any particular area, so I say both efforts Government and Private
> sector must compliment each other.
>
> With all the initiates on the drawing boards of both the government and
> the private sector, I say let all move from the drawing boards into
> implementation, Kai the computers at Kambaa Girls are gathering dust, and
> Bw. Ndemo, I signed up for both the digital village and digital school
> during the KICC expo and I have not heard a word on the way forward from
> your end.
>
> LK
>
>
>> My point is:
>>
>> Yu have limited room for infrastructure since the cost is constant and
>> only
>> increased usage can drop the price. The Government should NOT be a
>> competitor but a price sensitive user!
>>
>> You will have enough people now competing for the business of the
>> Government
>> and the private users .. That forces prices down. Having a state owned
>> cable
>> or a state owned Telkom is in my opinion not the way forward.
>>
>> Rgds
>>
>> Kai
>>
>>
>> -----Original Message-----
>> From: kictanet-bounces+kai.wulff=kdn.co.ke at kictanet.or.ke
>> [mailto:kictanet-bounces+kai.wulff=kdn.co.ke at kictanet.or.ke] On Behalf
>> Of
>> Wainaina Mungai
>> Sent: Saturday, May 05, 2007 10:35
>> To: kai.wulff at kdn.co.ke
>> Subject: Re: [kictanet] Day 5 - Statistics on Affordability-
>> CCKInternetStudyReport
>>
>> Kai said;
>>> The problem is when you create the demand and then some World Bank
>>> money
>>> starts to compete before you can recover the cost..
>>> ...The private sector needs the Government as a user there as well as
>>> the
>>> private companies and consumers. [Only then will the prices drop!]
>>
>> Pricing
>> I would like to assume that competition from government is as good as
>> competition from other market players. The beauty of competition is in
>> the
>> way it forces the private sector to put a smile on the face of every
>> consumer ;-) so as to guarantee revenue. I am convinced that a
>> significant
>> drop in prices results only from fierce competition and some degree of
>> regulation. TESPOK and others fought for years to introduce competition
>> which resulted in the current lower prices of internet and telephony
>> services.
>>
>>
>> The recent intervention of CCK on the pricing of mobile services is a
>> case
>> that proves that price controls may become necessary to protect
>> consumers.
>> For internet services, we need many 'small scale' providers whose
>> products
>> and pricing would be more market-driven and responsive to fluctuations
>> in
>> consumer needs.
>>
>> For instance, an internet user paying KShs. 6,000 per month for DSL per
>> month is actually incurring 14 cents per minute for a 30-day month. This
>> is
>> a great deal for any 24 hour user who may even make money through such
>> access to the internet. The same user would be said to incur 28 cents
>> per
>> minute if s/he were to use the link for an average 12 hours per day at
>> the
>> same monthly rate. There may be a catch here but there is a high
>> probability
>> that more businesses can survive on such low rates and pass such rates
>> down
>> to rural consumer.
>>
>>
>>
>> ---
>> Wainaina Mungai
>> http://www.madeinkenya.org
>>
>> SUSTAINABLE DEVELOPMENT is development that meets the needs of the
>> present
>> without compromising the ability of future generations to meet their own
>> needs.
>>
>>
>>>
>>>  FROM: kictanet-bounces+kai.wulff=kdn.co.ke at kictanet.or.ke
>>>  [mailto:kictanet-bounces+kai.wulff=kdn.co.ke at kictanet.or.ke] ON BEHALF
>>> OF
>>>  Rebecca Wanjiku
>>>  SENT: Friday, May 04, 2007 10:23
>>>  TO: kai.wulff at kdn.co.ke
>>>  SUBJECT: [kictanet] Day 5 - Statistics on Affordability -
>>>  CCKInternetStudyReport
>>>
>>>
>>>  thanks Kai for the response,
>>>  we need many people responding to this issue,
>>>
>>>  in my opinion, the government should find a way of using the WB money
>>>  through the private sector, so that the private sector does not see as
>>> if
>>>  the government is competing and killing the profit margin,
>>>
>>>  in this regard, the government could come up with some MOU with the
>>>  private sector so that some of the money invested is government's and
>> some
>>>  PS.
>>>  that way, part of the profits will be ploughed back (it will be
>>>  mandatory)
>>>
>>>  i remember during the OFC workshop, Kai shared how IFC funded a
>>> private
>>>  secotor consortium to carry out some survey at USD 300k and a similar
>>>  survey carried out by govts was valued at USD 3m
>>>
>>>  maybe this can help reduce costs and provide a way for govt and PS to
>>>  work together and deliver quality market services, develop the content
>> and
>>>  all..
>>>
>>>  its just an opinion, its not absolute,
>>>
>>>  lets hear as many voices as possible,
>>>  it is at these forums/discussions that great ideas come up,
>>>
>>>  regards
>>>
>>>  _KAI WULFF <KAI.WULFF at KDN.CO.KE>_ wrote:
>>>
>>>  Hello,
>>>
>>>  we leave it to the ISPs to create the demand. We were hoping that with
>>>  our
>>>  rural initiatives, like connecting schools and showing them how to
>>>  educate
>>>  the parents (and make money with this) will increase the demand on a
>>>  natural
>>>  way.
>>>
>>>  What we have seen wit some Rural BTS, it takes about 12 month until it
>>> is
>>>
>>>  break even ...
>>>
>>>  The problem is when you create the demand and then some World Bank
>>> money
>>>  starts to compete before you can recover the cost. It is my strong
>>>  believe
>>>  that wherever a device can be operated, there WILL be a market. The
>>>  private
>>>  sector needs the Government as a user there as well as the private
>>>  companies
>>>  and consumers. Only then will the prices drop! We still focus too much
>>> on
>>>
>>>  the INTERNET, what most people need for a start is LOCAL information
>>> and
>>>  communication .. so I would say: 90% local IP traffic and 10%
>>>  international
>>>  ..
>>>
>>>  Kai
>>>
>>>
>>>  ----- Original Message -----
>>>  From: "Joan Walumbe"
>>>  To:
>>>  Sent: Thursday, May 03, 2007 10:26
>>>  Subject: Re: [kictanet] Day 5 - Statistics on Affordability -
>>>  CCKInternetStudy Report
>>>
>>>
>>>  > Walu,
>>>  >
>>>  > I agree with you that affordablity is a factor especially for rural
>>>  > communities when it comes to access to the internet. But I think
>>> that
>>>  lack
>>>  > of awareness is an even bigger factor. It's fine for the urban folk
>>>  (who
>>>  > already recognise the benefits to the internet etc.) taking a short
>>>  break
>>>  > in
>>>  > shags to have the internet access when back home, but it there is no
>>>  > demand
>>>  > for the internet among the residents what is the point?
>>>  >
>>>  > So does KDN enter a market and then hope to create demand or is
>>> their
>>> a
>>>  > market that demands the service or is it a little of both?
>>>  >
>>>  > I understand that Kai would not be venturing into the rural areas if
>>> it
>>>
>>>  > did
>>>  > not make any financial sense. Can anyone provide some
>>> info/statistics
>>>  on
>>>  > demand for internet access in rural areas?
>>>  >
>>>  > Joan Walumbe
>>>  >
>>>  > ----- Original Message -----
>>>  > From: "John Walubengo"
>>>  > To:
>>>  > Sent: Thursday, May 03, 2007 9:01 AM
>>>  > Subject: [kictanet] Day 5 - Statistics on Affordability - CCK
>>>  > InternetStudy
>>>  > Report
>>>  >
>>>  >
>>>  > Day 5- Statistics on Affordability.
>>>  >
>>>  > I acknowledge an interesting thread filtering in on Trust
>>> relationships
>>>
>>>  > b/w
>>>  > IGOs/ISPs...feel free to continue contributing on that as well as on
>>>  > today's theme on affordability (multi-tasking
>>>  > encouraged by internet technologies ...)
>>>  >
>>>  > and just to pick up from Kai's projection of KDN fiber hitting
>>> Bungoma
>>>  in
>>>  > early August 2007. This would be quite a welcome and timely
>>>  development,
>>>  > but at what cost to the consumer? To what extend will the (internet)
>>>  > services be affordable to the rural/average communities?
>>>  >
>>>  > Affordability is a subjective term gven that what is considered
>>> cheap
>>>  by
>>>  > the
>>>  > Bill Gates of this world is probably not so for the average Kenyan
>>> on
>>>  the
>>>  > street. In trying to get an objective measurement for affordability,
>>>  the
>>>  > Report pegged it on the national average incomes. In other words, if
>>>  the
>>>  > monthly average income in Kenya is around 100USD and if the average
>>>  > monthly
>>>  > cost for internet access is also around 100USD then obviously the
>>>  average
>>>  > Kenyan will not bother with accessing the Internet - it just becomes
>>>  way
>>>  > beyond their means or too expensive or not affordable.
>>>  >
>>>  > The report indicated that access through the more convenient
>>> Internet
>>>  > Dial-up/Desktop services costed over 200% the average incomes (too
>>>  > expensive), while the same access through mobile phones was costing
>>>  just
>>>  > 8%
>>>  > of the average incomes (quite affordable). What needs to be done in
>>>  > order
>>>  > to make Internet Services more afforable to Kenyans?
>>>  >
>>>  > 1 day deliberation on this one.
>>>  >
>>>  > walu.
>>>  >
>>>  >
>>>  >
>>>  >
>>>  >
>>>  > _______________________________________________
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>>>
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>>>
>>>  Rebecca Wanjiku,
>>>  journalist,
>>>  p.o box 33515,
>>>  Nairobi.00600
>>>  Kenya.
>>>
>>>  Tel. 254 720 318 925
>>>
>>>  blog:http://beckyit.blogspot.com/
>>>
>>>
>>>  --------------------
>>>
>>>
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